Installation, Co-Maintenance and Software License and Upgrade Agreement - RoomSystems Inc.
INSTALLATION, CO-MAINTENANCE AND
SOFTWARE LICENSE AND UPGRADE AGREEMENT
THIS INSTALLATION, CO-MAINTENANCE AND SOFTWARE LICENSE AND UPGRADE
AGREEMENT ("MAINTENANCE AGREEMENT") is entered into as of *3, by and between
ROOMSYSTEMS, INC., a Nevada corporation, whose address is 390 North 3050 East,
St. George, UT 84790 hereinafter referred to as ("RSI"), and *1, a *9
corporation hereinafter referred to as ("HOTEL") whose address is *2.
RECITALS
WHEREAS, Hotel has entered into a Hotel Revenue Sharing Lease Agreement
dated as of *3 ("HOTEL Agreement") with eRoomSystem Technologies, Inc., a Nevada
corporation ("EROOM") which, among other things, provides financing of certain
equipment to store valuables and for the refrigeration and dispensing of
beverage and snack food items within the guest rooms of Hotel ("EQUIPMENT") and
which Equipment automatically records the sales and usage of merchandise in the
Hotel; and
WHEREAS, the Hotel Agreement, Equipment Schedule No. I dated as of *3
between eRoom and Hotel and all other Equipment Schedules issued from
time-to-time pursuant to the Hotel Agreement (collectively the "DOCUMENTS")
require Hotel to install the Equipment and enter into a maintenance agreement;
and
WHEREAS, eRoom has licensed to RSi (the "SOFTWARE LICENSE") certain
Software described herein (the "SOFTWARE"); and
WHEREAS, under the terms of the Software License, RSi has the right to
license the Software to Hotel; and
WHEREAS, Hotel is satisfying its installation and maintenance
obligations under the Documents by entering into this Maintenance Agreement with
RSi;
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the terms,
covenants, and conditions hereinafter contained, the parties hereto agree as
follows:
1. DELIVERY AND INSTALLATION.
(A) The Equipment (such term and all capitalized terms not
otherwise defined in this Maintenance Agreement shall have the meanings ascribed
to such terms in the Documents) shall be programmed by RSi, placed in the guest
rooms by Hotel (unless Hotel elects to purchase the turn-key installation
service offered by RSi as outlined in Section 1(C) below) and installed in
Hotel's premises (the "PREMISES") by RSi.
(B) In connection with the delivery and installation of the
Equipment, Hotel shall: (i) provide access to RSi's employees, agents and/or
representatives to all areas of the Premises necessary or appropriate in
connection with the installation of the Equipment; (ii) permit RSi's employees,
agents and/or representatives to install such wires, and similar items
throughout the
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Premises as RSi deems necessary for the installation; (iii) provide room and
board on the Premises to RSi's employees, agents or representatives during the
installation period of a minimum of seven (7) days per 100 hotel rooms, such
room and board (in Hotel's employee cafeteria, if available) not to include long
distance phone calls, use of personal laundry, valet, in-room movies, gift shop
purchases, alcoholic beverages, or any other charges other than room or board;
(iv) promptly, upon delivery of the Equipment to the Premises, unload all such
items and place them in a storage area or staging area, and supply adequate
staff to stock and place the Equipment in the guest rooms under the direction of
RSi's employees; and (v) pay for an "interface" between the Equipment and
Hotel's property management system located on the Premises .
(C) TURNKEY INSTALLATION. Hotel may hire RSi to provide the
services enumerated in Section 1(B)(iv) above by initialing the applicable box
below:
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(i) _______ YES, Hotel desires to retain RSi to provide the
services enumerated in Section 1(B)(iv) above at a cost
of $_____________, payable in full prior to commencement
of the installation.
(ii) _______ NO, Hotel will provide the services enumerated
in Section 1(B)(iv) above.
(D) If Hotel desires Equipment to be installed in rooms on the
Premises where there are no grounded outlets within six feet, and a MATV
connection or RJ-45 telephone socket within twelve feet of the location of
Equipment in the guest room, such Equipment shall be relocated to a location
that meets RSi's installation requirements or Hotel shall remedy the problem by
providing adequate extension cords or installing new outlets at Hotel's own
expense. Such work shall be performed in accordance with the applicable industry
standards.
(E) Prior to beginning the installation of the Equipment, RSi
shall certify that Hotel has provided all necessary requirements for the
installation of the Equipment, including but not limited to the following: (i)
an adequate site for the computer system (referred to herein sometimes as the
"SYSTEM") in a dust free location and an air conditioned environment; (ii) two
(2) telephone extensions and a telephone set at the sole expense of Hotel
adjacent to the modem supplied by RSi, for the express purpose of allowing RSi
to monitor the Equipment; (iii) adequate ventilation for the Equipment; and (iv)
a fixed grounded electrical outlet to be used for each item of Equipment in each
room.
2. ACCEPTANCE.
(A) The installation of the Equipment (or any stage thereof),
shall be deemed to be complete when the Equipment (or any portion thereof
designated to be installed in any stage) is operational. Upon completion of the
installation, RSi will provide written notice of such completion ("NOTICE OF
COMPLETION") to Hotel. Immediately upon receipt of the Notice of Completion,
Hotel shall inspect the Equipment and, if the Equipment is in good working
order, Hotel shall execute and deliver to eRoom the certificate of acceptance in
the form of Exhibit A to the Equipment Schedule (the "CERTIFICATE"), dated as of
the date of such inspection, or Hotel shall provide written notice to RSi
specifying and describing in detail each item with respect to which it is
claiming that the installation is not complete. If the Hotel fails to give such
written notice or to execute the Certificate within two (2) calendar days
following the Notice of Completion, it will be conclusively presumed that the
Equipment is in good working order and that the Equipment has been irrevocably
accepted by the Hotel as if the Hotel had executed the Certificate, and the
Hotel hereby agrees to be bound by the terms of the Certificate.
(B) If Hotel fails to promptly comply with any of its obligations
in sections 1 and 2 hereof, Hotel shall pay to RSi all costs and expenses
incurred by RSi with respect to the delay occasioned by such failure, including,
without limitation, storage, shipping costs, and per diem charges (including
lodging, meals and travel) for RSi's representatives.
(C) If RSi shall be unable to install the Equipment and make the
Equipment operational after reasonable efforts to do so other than as a result
of Hotel's failure to comply with its obligations under this Maintenance
Agreement and the Hotel Agreement, RSi shall so notify Hotel and shall remove
all of the Equipment from the Hotel and this Maintenance Agreement and all right
and obligations of the parties hereunder shall terminate immediately. Hotel
shall provide to RSi and its agents and representatives access to the Hotel for
such purposes for a reasonable time and at any reasonable time to enable RSi to
remove the Equipment.
3. TRAINING. RSi shall provide basic training on site in the operation
of the Equipment for Hotel's personnel involved in operation and maintenance of
the Equipment. The training will be conducted at the Hotel. RSi will provide up
to three (3) days of training without cost to Hotel. Hotel will provide room and
board at no cost for RSi personnel. If additional training is required,
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RSi will provide it at no charge provided it is at the time of a scheduled visit
as set forth in section 4 below. If additional training is required by Hotel at
a time other than during a scheduled visit, RSi will perform the training at
RSi's then customary charge for such service.
4. SERVICE. RSi and Hotel, as applicable, will each at its own
expense provide the following:
(A) RSi will provide twenty-four (24) hour telephone service and
maintenance to help maintain and keep the Equipment in normal working order
during the term of this Maintenance Agreement. RSi shall provide all
necessary parts to service the Equipment for the term of this Maintenance
Agreement.
(B) Hotel shall provide maintenance personnel capable of removing
and replacing defective parts to the Equipment in a timely manner and provide
such service and maintenance that are necessitated by normal usage. RSi may, at
its option, elect to replace, rather than repair, any of the Equipment it is
obligated to maintain hereunder.
(C) The Hotel shall be responsible for purchasing and providing
for use with the Equipment all consumable items, including printed menus,
printer paper, diskettes and printer ribbons.
(D) The Hotel shall provide at no expense to RSi on an as needed
basis room and board for the training, service, and maintenance crew that will
make follow up visits to the Hotel.
(E) RSi will monitor the operations of the Placed Items, and will
make semi-annual visits to Hotel, to provide Hotel retraining, merchandising
recommendations, operational recommendations and software support.
5. WARRANTIES, DISCLAIMER AND LIMITATION OF REMEDIES RE: THE
EQUIPMENT.
(A) RSi warrants that the Equipment will be installed in a
workmanlike manner and that the Equipment will be free from defects in
workmanship and materials for a period of three months from the Acceptance Date.
(B) Except as expressly provided herein, RSi expressly disclaims
all other warranties with respect to the Equipment, express or implied.
(C) The limited express warranty provided herein is for the
benefit of Hotel only and is not for the benefit of any other person.
(D) The limited express warranty provided herein is conditioned
upon proper use of the Equipment and Software (as defined in section 19 (K) of
the Hotel Agreement). No warranty shall apply to any item of Equipment or the
Software, (i) which has been modified in any respect without the express written
consent of RSi, (ii) which has been installed, serviced or repaired by or on
behalf of Hotel by any person other than an authorized agent of RSi, (iii) which
has been removed from the Hotel, (iv) which has been subject to unusual physical
or electrical stress, or (v) which has been damaged by reason of accident,
neglect or misuse.
(E) In the event that any item of Equipment or the Software shall
be defective in workmanship of material within the term of this Maintenance
Agreement, RSi shall replace the item of Equipment with a new or reconditioned
component or components thereof, or make such modifications to the Software in
order to return it to good working order, subject to the following terms and
conditions: (i) Hotel shall give notice to RSi of the defect within the term of
this Maintenance Agreement; (ii) Hotel shall ship any defective part or
component to such location as RSi shall designate at Hotel's expense; (iii) RSi
may, at its sole discretion, provide a comparable substitute part or component
for any defective or failed part or component, which shall fully discharge RSi's
obligation to repair or replace such defective items; and (iv) Hotel is
responsible for installing components on the Equipment and sending and receiving
the parts as necessary to and from RSi.
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6. SOFTWARE LICENSE AGREEMENT.
(A) The parties hereto acknowledge that eRoom owns all
intellectual property rights in and to the Software including all enhancements,
modification and upgrades thereto.
(B) Subject to and on the terms and conditions hereof and during
the term of this Maintenance Agreement, as hereinafter described (the "TERM"),
RSi grants to Hotel a non-transferable and non-exclusive license (the "LICENSE")
to use the Software in operating the Equipment. The Software must be used solely
by Hotel for the purpose and subject to the limitations provided herein and
Hotel shall not be entitled to (i) give, deliver, provide access to or authorize
the use of the Software by any person other than authorized employees of Hotel;
or (ii) give, sell, assign or grant any rights with respect to the Software to
any person, corporation, partnership, third party entity without the express
written consent of RSi. Hotel may not assign the License without the prior
written consent of RSi, which consent shall not be unreasonably withheld.
Further, Hotel may only assign the License to a person, firm, company,
partnership or corporation that acquires Hotel by means of a merger,
consolidation or acquisition of all or substantially all of the property and
assets of Hotel.
(C) eRoom retains exclusive title to, any and all ownership in,
the Software, and all copies thereof, regardless of the form or medium in which
the original or any copies thereof may exist. All rights with respect to the
Software not expressly granted to Hotel hereunder are reserved to eRoom. The
License does not grant Hotel any right, claim, title to or ownership interest in
the Software, any trade secret, patent, copyright, trade name, trademark or
other proprietary right owned, applied for or subsequently acquired by RSi or
eRoom.
(D) Hotel agrees that the Software will be used by Hotel solely at
the address set forth in Section 5 hereof and solely for the operation of the
Equipment. Hotel shall not modify, adapt, translate, reverse engineer, decompile
or disassemble the Software or create works based on the Software without the
express prior written consent of RSi. Any modification, enhancement, change in
or addition to the Software whether made by RSi, Hotel or otherwise shall be and
remain the sole and exclusive property of eRoom.
(E) Hotel agrees that the Software and related materials provided
by RSi contain proprietary information and trade secrets of RSi and eRoom (the
"CONFIDENTIAL INFORMATION"). Hotel agrees that it will authorize and permit the
Software and Confidential Information's use by its employees solely for the
purpose and in accordance with the provisions hereof, and will not disclose,
authorize or permit disclosure by its employees of the Confidential Information
to any person or entity other than Hotel's authorized employees or agents.
(F) The Term of this License shall be for the period of time in
which Hotel continuously uses the Equipment in the Hotel in accordance with the
terms and conditions of this Maintenance Agreement and the Documents, and shall
be co-terminus with the Hotel Agreement. Upon the end of the Term, Hotel shall
return the Software, including all enhancements, source codes, documentation and
copies, to RSi.
(G) The License granted herein shall exist for the Term. If the
Equipment is leased and not purchased, the License shall be canceled upon the
expiration or maturation of such term of any such lease. Any and all upgrades or
enhancements to the Software shall be subject to the terms of the License.
7. WARRANTIES, DISCLAIMER AND LIMITATION OF REMEDIES RE: THE
SOFTWARE.
(A) RSi warrants that the Software is free from defects in
workmanship and materials for a period of 90 days from the installation date,
and that it will perform substantially in accordance with its specifications for
90 days following receipt (the "LIMITED WARRANTY"). Hotel's exclusive remedy for
breach of the Limited Warranty shall be replacement of the Software.
(B) EXCEPT AS EXPRESSLY PROVIDED HEREIN, RSI MAKES NO OTHER
WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO THE SOFTWARE AND DOCUMENTATION
AND SPECIFICALLY DISCLAIMS THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS
FOR A PARTICULAR PURPOSE. RSI DOES NOT WARRANT THAT THE OPERATION OF THE
SOFTWARE WILL BE UNINTERRUPTED OR ERROR-FREE. AND
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EXPRESSLY DISCLAIMS ALL OTHER WARRANTIES WITH RESPECT TO THE SOFTWARE, EXPRESSED
AND IMPLIED.
(C) THE LIMITED WARRANTY PROVIDED HEREIN IS FOR THE BENEFIT OF
HOTEL ONLY AND IS NOT FOR THE BENEFIT OF ANY OTHER PERSON OR ENTITY TO THE
MAXIMUM EXTENT PERMITTED BY LAW. IN NO EVENT SHALL RSI BE LIABLE FOR ANY
SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES WHATSOEVER, INCLUDING ANY
CLAIMS FOR LOST PROFITS, BUSINESS INTERRUPTION, LOST INFORMATION OR OTHER
ARISING OUT OF THE USE OR INABILITY TO USE THE SOFTWARE.
(D) The Limited Warranty provided herein is conditioned upon
proper use of the Equipment and the Software. The Limited Warranty shall not
apply to any item of Software (i) which has been modified in any respect without
the express written consent of RSi; (ii) which has been installed, serviced or
repaired by or on behalf of Hotel by any person other than an authorized agent
of RSi; (iii) which has been removed from the Premises; (iv) which has been
subject to unusual physical or electrical stress; or (v) which has been damaged
by reason of accident, neglect or misuse.
(E) In the event that the Software is defective in workmanship or
material within the term of this License, RSi shall replace the Software, or
make such modifications to the Software in order to return it to good working
order, subject to the following terms and conditions: (i) Hotel shall give
notice to RSi of the defect within the Term; (ii) Hotel shall ship defective
Software to such location as RSi shall designate at Hotel's expense; (iii) RSi
may, at its sole discretion, provide a comparable substitute Software or
component for any defective or failed Software, which section shall fully
discharge RSi's obligation to repair or replace such defective Software; and
(iv) Hotel shall be responsible for installing components within the Refreshment
Centers and sending and receiving the parts as necessary to RSi.
(F) Notwithstanding anything contained herein to the contrary, RSi
agrees to indemnify, hold harmless and defend Hotel from and against any and all
claims, demands, actions, suits, proceedings, costs, expenses, damages, and
liabilities at law or in equity, including reasonable attorney's fees arising
out of, connected with or resulting from this License and the Purchase
Agreement, including without limitation, the manufacture, selection, purchase,
delivery, possession, condition, use, operation or return thereof except to the
extent a third party claim has arisen from Hotel's negligence or willing
misconduct relating to the care and oversight of the Equipment while in Hotel's
possession. RSi's and Hotel's obligations hereunder will survive the expiration
of this License with respect to acts or events occurring or alleged to have
occurred prior to the return of the Equipment to RSi at the end of the Term.
8. INTELLECTUAL AND OTHER PROPERTY RIGHTS. All copyright, patent, trade
secret, trademark, Confidential Information and other intellectual proprietary
rights in the Software are and shall remain the exclusive property of eRoom.
Hotel agrees not to disclose any of the Software to any third party, nor reverse
engineer, disassemble, decompile, copy, modify, translate, reproduce, transfer,
or distribute the Software or related documents to any third party. In addition,
all data and information collected by or residing in the Equipment, at all times
during the Term and thereinafter, is the property of eRoom. Furthermore Hotel
shall be solely responsible for the actions of its employees, agents,
consultants, partners, and all third parties with respect to the Software.
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9. SERVICE AND LICENSE FEES. Hotel shall pay to RSi a fee for the
services, License and materials provided by RSi pursuant to this Maintenance
Agreement in the amount of $0.08 per day per Placed Item. These payments may be
increased annually by a cost of living adjustment "COLA." These payments will be
made quarterly in advance. The total quarterly payment will be calculated by
multiplying the number of Placed Items times $0.08 times 91.25. Hotel shall not
have to make this payment so long as any Equipment is subject to the revenue
sharing arrangement of the Hotel Agreement and so long as no Event of Default
exists and is continuing under the Hotel Agreement.
10. TERM OF MAINTENANCE AGREEMENT. This Maintenance Agreement shall
become effective on the date of execution and shall remain in force and effect
until the earlier of the following to occur: (A) The expiration of all of the
Documents; or (B) Hotel ceases to continuously use the Equipment in accordance
with the terms and conditions of all of the Documents.
11. LIABILITY FOR DAMAGE TO THE PRODUCT. Hotel shall be responsible for
any damage to the Equipment which is caused by intentional or negligent conduct
of Hotel, its employees, agents, or representatives or Hotel guests while the
Equipment is in Hotel's possession. Hotel shall not be responsible for any
damages which are due to ordinary wear and tear, which Hotel could not
reasonably prevent, or damage caused by the intentional or negligent acts of
RSi.
12. EXCLUSIVE DEALING. During the term of this Maintenance Agreement,
RSi shall have the exclusive right to install and service the Equipment in
Hotel's guest rooms. Hotel shall not install any other products similar to the
Equipment in Hotel's guest rooms during this period without the prior written
consent of RSi.
13. NOTICE. All notice or other communications required or permitted to
be given hereunder shall be in writing and shall be (i) delivered personally,
(ii) mailed, postage prepaid, or (iii) faxed and a copy mailed to the parties,
as follows:
If to RSi: RoomSystems, Inc.
390 North 3050 East
St. George, UT 84790
Facsimile: 435-628-3611
If to Hotel: *1
*2
With a copy to: eRoomSystem Technologies, Inc.
3770 Howard Hughes Parkway, Suite 175
Las Vegas, NV 89109
Attn: General Counsel
Facsimile: 702-792-2403
12. MISCELLANEOUS PROVISIONS. The following miscellaneous provisions
are an integral part of this Maintenance Agreement:
(A) BINDING OBLIGATION. This Maintenance Agreement shall inure to
the benefit of and constitute a binding obligation upon the contracting parties,
their respective heirs, legal representatives and permitted assigns.
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(B) MODIFICATIONS. This Maintenance Agreement may not be modified
except by an instrument in writing signed by the parties hereto.
(C) HEADINGS. The headings used in this Maintenance Agreement are
for reference purposes only and shall not be deemed to limit or affect in any
way, the meaning or interpretation of any of the terms or provisions of this
Maintenance Agreement.
(D) SEVERABILITY. The provisions of this Maintenance Agreement are
severable, and should any provision hereof be void, voidable, unenforceable, or
invalid, such a void, voidable, unenforceable or invalid provision shall not
affect any other portion or provision of this Maintenance Agreement.
(E) WAIVER. Any waiver by any party hereto of any breach of this
Maintenance Agreement of any kind or character whatsoever by the other party,
whether such waiver is direct or implied, shall not be construed as a continuing
waiver or consent to any subsequent breach of this Maintenance Agreement on the
part of the other party.
(F) APPLICABLE LAW, JURISDICTION AND VENUE. This Agreement shall
be governed by, and construed in accordance with, the laws of the state of
Nevada, without regard to principles of conflicts of law. RSi and Hotel hereby
consent to jurisdiction and venue in any state or federal court in the state of
Nevada and hereby waive any objections that jurisdiction or venue in any such
court is not proper.
(G) ATTORNEYS' FEES. In the event any action or proceeding is
brought by any party under this Maintenance Agreement, the prevailing party
shall be entitled to recover reasonable attorneys' fees and costs of court from
the non-prevailing party.
(H) COUNTERPARTS. This Maintenance Agreement may be executed
simultaneously in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
(I) CONFIDENTIALITY. The terms of this Maintenance Agreement shall
be confidential, and neither party shall reveal to any person, hotel, or other
entity the terms hereof and no copies shall be made of this Maintenance
Agreement The parties except for the parties confidential records and except as
necessary to enforce its terms, without the prior written consent of the other
party.
(J) JURISDICTION AND VENUE. This Maintenance Agreement will be
governed by and interpreted pursuant to the laws of the State of Nevada. The
parties agree any action to enforce any provision of this Maintenance
Agreement shall be brought in Las Vegas, Nevada.
(K) THIRD PARTY BENEFICIARY. eRoom is intended to be a third party
beneficiary under this Agreement.
IN WITNESS THEREOF, the parties hereto have executed this Maintenance
Agreement the day and the year first named above.
RSI: HOTEL:
ROOMSYSTEMS, INC. *1
a Nevada corporation a *9 corporation
By: By:
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Steven L. Sunyich
Its: Chief Executive Officer Its:
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